Summary
The stock market has come alive after some scary moments last week. In the past three days, the S&P 500 (SPX) has gained almost 3%, while the Nasdaq and Nasdaq 100 (QQQ) have reclaimed over 3%. The SPX is up 3.6% from its intraday low last Friday, the Nasdaq has popped 4.5%, and the QQQ is up 4.2%. The SPX has retaken its 50-day average quickly, and the five-day/13-day exponential moving average (EMA) crossover is close to turning bullish. The five-/13-day EMA is already back to bullish on the Nasdaq and the QQQ. All three indices have retraced over 61.8% of their recent setbacks and are not far from making all-time highs. Indicators we rarely talk about, and which are similar to Bollinger Bands, are price channels. For the daily chart, we use 20-day price channels. The upper channel is equal to the 20-day high, and the lower channel is equal to the 20-day low. The middle channel is the midpoint of the other two channels. There are many ways to interpret price channels. They can be used for support and resistance, overbought and oversold areas, the initiation of a strong uptrend with a break over the upper channel, and vice versa. From October 2023, the SPX fell below its lower channel but rebounded quic